Tesla limits legal action for minor stockowners in lawsuits
Revamped Take:
Just chattin' with ya about the haps at Tesla, the electric car goliath led by ol' Elon Musk. Here's a lowdown on how this game is professionally played:
Small shareholders, watch out:Tesla's cleverly shuffling the legal deck against you, small fry. In the future, if you hold less than 3% of the shares, you won't be able to sue the higher-ups for any perceived mismangement, thanks to alterations in the corporate bylaws. That's around 97 million shares worth about $34 billion today!
Musky-business compensation:Remember the fuss over Musk's compensation package topping $56 billion? A Delaware court challenged it last year, but Musk ain't backing down—he's appealing the decision. Whether he'll get his cake and eat it too remains to be seen.
Newblood, Jack Hartung:Friday saw some fresh blood join Tesla's board: Jack Hartung, former bigwig at Chipotle, is moving on in! Considered controversial by some, Musk's got a history of filling board seats with folks close to him. Hartung's different—not personally linked to Musk, but apparently has a connection through Musk's brother, Kimbal, who was on Chipotle's board.
Silent stockwatchers:With all the drama surrounding Musk's political escapades and stint as Trump's efficiency czar (DOGE), Tesla's board has been remarkably quiet. High paychecks have kept them in line, rubber-stamping Musk's decisions, according to some claims.
Sidenote:
Small shareholders are getting the short end of the stick in the new corporate bylaws. As Tesla elevates itself against legal challenges from small investors, access to justice is becoming more exclusive, and only large shareholders hold the keys to accountability for breaches of duty. This strategic shift prioritizes corporate stability at the expense of shareholder advocacy, changing the power dynamics between shareholders and management.
In the United States, the financial aspect of Tesla's operations indicates a focus on business stability, as evident in their corporate bylaws that limit small shareholders' rights to sue for alleged mismanagement, affecting approximately 97 million shares currently worth around $34 billion. On a related note, the technology sector is also involved, as Jack Hartung, the former executive of Chipotle, brings his expertise to the Tesla board, potentially impacting the company's future ventures in this domain.
